Planning a marriage can be exciting, but conversations about money, property, and what could happen if the marriage ends are not always easy. A prenuptial agreement can give couples an opportunity to address these issues before they become sources of conflict. In Colorado, however, a prenup needs to meet certain legal requirements to be enforceable. Understanding those requirements can help couples approach the process with greater clarity.
Determine What the Agreement Should Address
A prenuptial agreement can address financial rights and responsibilities between future spouses. Rather than relying on a standard form, couples should consider which issues are important to their particular circumstances.
The agreement may address:
Property: The agreement can identify certain property as separate or establish how property will be treated during the marriage and if the marriage ends.
Debts: Couples can establish how certain debts and financial obligations will be handled.
Spousal maintenance: A prenup may address rights and obligations concerning spousal maintenance, subject to Colorado law.
A couple's financial situation may include a home, retirement accounts, investments, a business, inherited property, or significant debts. Addressing these matters specifically can make the agreement more meaningful than using broad or unclear language.
Provide Complete Financial Information
Financial disclosure is an important part of creating a valid prenuptial agreement. Colorado law requires adequate financial disclosure before signing, unless the other requirements for adequate knowledge under the law are met. The disclosure generally includes a reasonably accurate description and good-faith estimate of property, liabilities, and income.
Before preparing or signing a prenup, each person should gather relevant financial information, including:
Assets: Bank accounts, real estate, investments, retirement accounts, and business interests.
Liabilities: Mortgages, loans, credit card balances, and other debts.
Income: Employment income, business income, investment income, and other significant sources of earnings.
Accurate information gives both parties a clearer understanding of what they are agreeing to. It can also help prevent disputes later about whether important financial information was withheld.
Allow Enough Time for Review
A prenuptial agreement should not be treated as paperwork to complete immediately before the wedding. Both parties need an opportunity to review the proposed terms, ask questions, and consider the potential legal and financial consequences.
Colorado law addresses access to independent legal representation and provides that a party must have a reasonable opportunity to decide whether to retain an attorney, locate one, obtain advice, and consider that advice before signing.
Starting the process well before the wedding can provide time to:
Discuss expectations: Couples can identify financial concerns before negotiating specific provisions.
Review the agreement: Each person can carefully consider the proposed terms.
Seek independent advice: Separate legal counsel can explain how the agreement may affect each person's rights.
Giving the process adequate time can also reduce the pressure associated with making significant legal decisions close to the wedding date.
Make Sure Both Parties Sign Voluntarily
A prenuptial agreement is intended to be a mutual legal contract, so the circumstances surrounding its creation matter. Under Colorado law, a prenup may be unenforceable if a party proves that their consent was involuntary or resulted from duress.
Both parties should have a meaningful opportunity to understand the agreement and make their own decisions about whether to sign it. Pressure, rushed negotiations, or presenting an agreement at the last minute can create unnecessary complications.
The agreement also must be in a record and signed by both parties. A Colorado premarital agreement generally becomes effective upon marriage.
Review the Agreement as Circumstances Change
Creating a prenup does not necessarily mean the agreement should be ignored after the wedding. Financial and family circumstances can change significantly over the course of a marriage.
For example, a couple may later acquire real estate, start or sell a business, receive an inheritance, or experience other substantial financial changes. A change in circumstances may prompt questions about whether an existing agreement still reflects the couple's intentions.
Colorado law also allows a premarital agreement to be amended or revoked after marriage when the applicable legal requirements are satisfied. Any proposed changes should be reviewed carefully before they are signed.
Get Legal Guidance Before Signing
A prenuptial agreement can involve decisions about property, debt, income, and financial rights that may have lasting consequences. Understanding the agreement before signing is important, particularly when the couple has substantial assets, a business, children from a prior relationship, or other complex financial circumstances.
The Gasper Law Group can help Colorado Springs couples understand the legal considerations involved in drafting, reviewing, and negotiating a prenuptial agreement. Call (719) 212-2448 or contact The Gasper Law Group today to discuss your prenuptial agreement with a Colorado family law attorney.